There are no sign of Brexit jitters amongst firms in the Federation of Master Builders (FMB's) latest State of Trade Survey for Q2 2018, with 41% of firms reporting higher workloads compared with 32% in Q1 2018. In addition, those reporting lower workloads fell to 18% from 24%.
Brian Berry, Chief Executive of the FMB, said the second quarter of 2018 proved to be a positive one for the UK's builders.
"Our latest research shows that firms enjoyed stronger growth in workloads than they did in the first three months of this year," he said.
"Pleasingly, the construction SME sector has now enjoyed more than five years of consecutive growth. Furthermore, employment rose at a faster pace in the second three months of 2018 than it did in the first three months. Looking ahead, despite growing political uncertainty and Brexit now less than a year away, construction SMEs remain positive. Businesses are optimistic with nearly half of firms predicting rising activity levels over the next three months."
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Yet despite the SME sector enjoying more than five years of consecutive quarterly growth. 76% of builders reported increasing material prices in Q2 2018, while 65% are struggling to hire bricklayers and 60% are struggling to hire carpenters and joiners. Furthermore, 54% of firms are predicting a rise in salaries and wages over the next six months.
Mr Berry added: "Despite this optimism, the sector should not be too complacent because strong headwinds remain in place. The sector is still contending with rising skills shortages.
"The latest evidence reveals that nearly all of the key occupations have become harder to recruit in the second quarter of this year compared to the previous three months. Bricklayers continue to be the hardest to recruit with nearly two-thirds of firms struggling to hire them, and carpenters not far behind. Without guaranteed access to skilled EU workers, there is a real possibility that skills shortages will further intensify.
"Skills shortages are also the leading cause of rising wages. This, coupled with the fact that margins continue to be squeezed by significant material price increases, should add a cautionary note to these otherwise encouraging findings."
(LM/MH)
